LIMITED PARTNERSHIPS

The limited partnership is a hybrid containing elements of both partnerships and corporations. A limited partnership may be formed by parties who wish to invest in a business and share in its profits, but seek to limit their risk to the amount of their investment. The law provides such limited risk for the limited partner, but only so long as the limited partner plays no active role in the dayto-day management and operation of the business. In effect, the limited partner is very much like an investor who buys a few shares of stock in a corporation, but has no significant role in running the business.